Northern Ireland's retiring chief constable has urged the region's politicians to step up and deal with outstanding peace process issues, claiming the disputes are a drag anchor holding back progress.

On his last day in the office after five years at the helm of the Police Service of Northern Ireland, Matt Baggott expressed frustration that officers continued to bear the brunt of community fallout caused by the inability to deal with big ticket problems.

Political efforts to find consensus on issues around flags, parades and the toxic legacy of the Troubles have so far failed, despite an intensive six months' talks initiative chaired by former US diplomat Dr Richard Haass last year.

Scores of police officers were injured in serious rioting in Northern Ireland last year linked to flag and parading disputes while the service repeatedly finds itself embroiled in controversies linked to investigations into historic crimes.

Mr Baggott, who has already called for the responsibility for investigating legacy killings to be handed to a new independent body, also stressed the need for the PSNI's funding to be maintained at current levels.

"I think they (politicians) have stepped up to the mark in many ways already, but I think there has to be a preparation to give ground on all sides to finally resolve how the past should be tackled because although many people are just getting on with their lives, it remains a drag anchor and I think it plays out into the willingness to invest in Northern Ireland, it plays out on to the streets in terms of sometimes the disorder and it creates a constant sense of tension."

He called on Stormont's leaders to intensify their efforts to find agreement.

"They have got to work as hard as they can and deal with this," he said.

"The very fact Richard Haass came over is a sign of the international expectation now.

"Northern Ireland is a place I think could be enormously prosperous into the future, a world leader and many of the things are already in place, it just needs these extra bits to be dealt with."

He said the need to police disputes, and the associated resource outlay, meant that officers could not focus on other crime problems, such as drugs and alcohol, organised crime, human trafficking, cyber crime, sexual and domestic violence and child exploitation.

"If you are standing on the line dealing with a lack of agreement between local people then you are not dealing with those (other crimes), and it is for politicians and the communities to resolve these issues and I would give them every encouragement to do so," he said.

"The past needs a different way. The parading needs to have a way that's about local consensus and if people don't like the Parades Commission (adjudication body) they need to come up with a different way of dealing with it, but even if they don't like the Parades Commission, when they make a determination there should be an unequivocal support for the rule of law by all political leaders speaking as one.

"Then when it comes to flags - the erection of flags is not a policing matter. If it's a breach of the peace we have always said we'd deal with it, but nowhere else in the United Kingdom do the police deal with taking down flags from flag poles - that should be a matter for district councils."

Mr Baggott said the job of PSNI chief was the most challenging of his career.

He said he could never have prepared himself for just how political the role is.

"I don't think any degree of preparation can give you just the full details of how the politics works," he said.

Current assistant chief constable George Hamilton is taking over at the top of the PSNI.

Mr Baggott said he did not need to give his successor any advice as he was such a capable officer.

He said he looked back at his five years with fondness and highlighted the devolution of policing and justice powers to Stormont in 2010; the efforts to suppress dissident republican terrorism; and the successful hosting of many major events, such as last year's G8 summit in Co Fermanagh, as major accomplishments he and colleagues had delivered.

He added: "There will be things with hindsight that I know I will have made mistakes but probably that comes with the benefit of hindsight, not when you are still in the post sometimes."

Mr Baggott, a former chief constable in Leicestershire who joined the Metropolitan Police when he was 18, said he was going to take a few months off to reflect on the next step in his career.

Today his final engagement will see him presenting long service medals to colleagues.

"It will be with a heavy heart I leave," he said.

"It will be a bit bewildering for the first week or so because the warrant card won't be there - this is all I have ever known since being a teenager. It's a little bit exciting but also apprehensive."

He added: "It's far from pipe and slippers, it's going to be a time of reflection, a bit of a sabbatical and then I'll decide what I want, but I am going to give a little bit of time back to my family and friends and just do a bit of thinking.